Basic Terms Used for Real Estate & Mortgages
Real estate & loans may involve other terms. In the event you don't understand some of these terms, ask for help from your real estate agent, lender or attorney.
Land Contract
The buyer is allowed to use and occupy the land however, the deed is not given to the buyer until the seller is given the full sale price.
Lease with Option to Purchase
During the term of the lease or other defined term, the lessee has the option to purchase the property.
Lessee
A person who is renting property by means of a lease.
Lessor
A person who is renting the property to the lessee by means of a lease.
Lien
The claims of debt, judgment, mortgage or taxes brought against a property.
Loan Application
Detailed information required about the borrower and the property. This information must be given to the lender before a loan can be approved.
Loan origination fee or points
The fee charged by a mortgage lender or broker for originating a loan. Not to be confused with discount points which are used to buy down the rate of interest.
Loan to Value Ratio (LTV)
Total amount of loan divided by the property value.
Loan Servicing
The acts of collection of loan payments, property tax and escrows, foreclosing on defaulted loans, remitting payments.
